{"id":7411,"date":"2020-04-05T17:21:52","date_gmt":"2020-04-05T11:51:52","guid":{"rendered":"https:\/\/triumphias.com\/blog\/?p=7411"},"modified":"2020-04-05T17:21:52","modified_gmt":"2020-04-05T11:51:52","slug":"financial-stability-report","status":"publish","type":"post","link":"https:\/\/triumphias.com\/blog\/financial-stability-report\/","title":{"rendered":"Financial Stability Report"},"content":{"rendered":"<p><span style=\"color: #0000ff;\"><strong>\u00a0Relevance: Prelims: Economy<\/strong><\/span><\/p>\n<p><strong>Why in News<\/strong><\/p>\n<p>The<span style=\"color: #ff0000;\">\u00a0<strong>Reserve Bank of India<\/strong><\/span>\u00a0has released the\u00a0<strong><span style=\"color: #ff0000;\">20<sup>th<\/sup>\u00a0issue of the Financial Stability Report (FSR)<\/span>.<\/strong><\/p>\n<ul>\n<li>The FSR reflects the collective assessment of the\u00a0<span style=\"color: #ff0000;\"><strong>Sub-Committee of the Financial Stability and Development Council (FSDC)<\/strong>\u00a0<\/span>on risks to financial stability and the resilience of the financial system.<\/li>\n<li>The Report also discusses issues relating to development and regulation of the financial sector.<\/li>\n<\/ul>\n<p><strong>Key Points<\/strong><\/p>\n<p><img decoding=\"async\" src=\"https:\/\/www.examrace.com\/Current-Affairs\/posts\/e2\/e2d6d3ac352c744464756ea268f066563526e182c399ad509ba36193f2fab808\/This-image-in-RBI-Financial-Stability-Report-2019.png\" alt=\"RBI Financial Stability Report 2019- Translation in Hindi, Kannada ...\" \/><\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li><strong>Credit Growth<\/strong>\n<ul>\n<li><strong>Bank credit<\/strong>\u00a0is the total amount of funds a person or business can borrow from a bank.<\/li>\n<li>Scheduled Commercial Banks\u2019 (SCBs) credit growth remained subdued at 8.7% year-on-year (y-o-y) in September 2019, down from 13.2% in March 2019.<\/li>\n<li>Private Sector Banks (PVBs) registered double digit credit growth of 16.5% in September 2019.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Expected Increase in Gross Non-Performing Asset (GNPA) Ratio<\/strong>\n<ul>\n<li>SCB\u2019s Gross Non-Performing Asset (GNPA) ratio of banks may increase to 9.9% by September 2020 from 9.3% in September 2019.<\/li>\n<li>Public Sector Banks\u2019 (PSB) GNPA ratios may increase to 13.2% by September 2020 from 12.7% in September 2019.<\/li>\n<li>For private banks, the ratio may climb to 4.2% from 3.9%, under the stress scenario.<\/li>\n<li>Foreign banks\u2019 (FB) GNPA ratio may increase to 3.1% from 2.9% in September 2019.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ul>\n<li>All banks\u2019\u00a0<strong>Capital to Risk-weighted Assets Ratio (CRAR)<\/strong>\u00a0improved to 15.1% in September 2019 from 14.3% in March 2019, following the recapitalisation of PSBs by the government.\n<ul>\n<li><strong>CRAR<\/strong>\u00a0is a measurement of a bank&#8217;s available capital expressed as a percentage of a bank&#8217;s risk-weighted credit exposures.<\/li>\n<li>It is\u00a0<strong>also known as the Capital Adequacy Ratio (CAR).<\/strong><\/li>\n<li>CAR = (Tier 1 Capital + Tier 2 Capital)\/Risk weighted Assets<\/li>\n<li><strong>Tier-1 capital,<\/strong>\u00a0or core capital, consists of equity capital, ordinary share capital, intangible assets and audited revenue reserves. Tier-1 capital is the capital that is permanently and easily available to cushion losses suffered by a bank without it being required to stop operating.<\/li>\n<li><strong>Tier-2 capital<\/strong>\u00a0comprises unaudited retained earnings, unaudited reserves and general loss reserves. This capital absorbs losses in the event of a company winding up or liquidating<\/li>\n<\/ul>\n<\/li>\n<li><strong>Provision Coverage Ratio (PCR)<\/strong>\u00a0of all SCBs rose to 61.5% in September 2019 from 60.5% in March 2019 implying increased resilience of the banking sector.\n<ul>\n<li>Provisioning Coverage Ratio (PCR) refers to the prescribed percentage of funds to be set aside by the banks for covering the prospective losses due to bad loans.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p><span style=\"color: #0000ff;\"><strong>For more such notes, Articles, News &amp; Views Join our Telegram Channel.<\/strong><\/span><\/p>\n<p><span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" title=\"Telegram Link\" href=\"https:\/\/t.me\/triumphias\" target=\"_blank\"><strong>https:\/\/t.me\/triumphias<\/strong><\/a><\/span><\/p>\n<p><span style=\"color: #0000ff;\"><strong>Click the link below to see the details about the UPSC \u2013Civils courses offered by Triumph IAS.<\/strong> <\/span><span style=\"color: #ff0000;\"><strong><a style=\"color: #ff0000;\" title=\"Courses available\" href=\"https:\/\/triumphias.com\/pages-all-courses.php\">https:\/\/triumphias.com\/pages-all-courses.php<\/a><\/strong><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>\u00a0Relevance: Prelims: Economy Why in News The\u00a0Reserve Bank of India\u00a0has released the\u00a020th\u00a0issue of the Financial Stability Report (FSR). The FSR<\/p>\n","protected":false},"author":1,"featured_media":6714,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[123],"tags":[392],"class_list":["post-7411","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-current-affairs","tag-union-public-service-commission-upsc"],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/posts\/7411","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/comments?post=7411"}],"version-history":[{"count":1,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/posts\/7411\/revisions"}],"predecessor-version":[{"id":7412,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/posts\/7411\/revisions\/7412"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/media\/6714"}],"wp:attachment":[{"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/media?parent=7411"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/categories?post=7411"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/triumphias.com\/blog\/wp-json\/wp\/v2\/tags?post=7411"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}